Friday, August 23, 2013

Boring grown up problems.

Well, I guess I am officially a grown up (sort of). I can vote, drink, rent a car and.... as of yesterday I have a brand new credit card. Yes. I am 25 years old and I am just now getting my very first credit card.

You all probably think I'm stupid and irresponsible for waiting this long to start building credit.
Honestly I don't really have a good reason for why I didn't get a credit card sooner. Maybe because I don't really understand what you need one for? Maybe because I think it's a bit of a scam?

I earn a salary and I pay for things with money that I have, either with my debit card or cash.  I've never needed credit. I am responsible with my finances (most of the time... ignore the new outfit I bought for the wedding, and the plane tickets I just bought for Labor Day weekend). I pay my bills on time, I have no student loans to pay off or car payments to make (thank you, thank you, times a trillion mom and dad) and yet if I wanted to buy a home tomorrow I would likely not get approved as I have no credit.

No credit apparently is like bad credit in the eyes of the bank/the world and that sucks.

I'm not planning to buy a home tomorrow. But I am planning on a future that will include a home of my own. One that I can decorate and love and fill with my family (and put all those Pinterest ideas to work).

But y'all I know nothing... I may check all the adult boxes, but I had to ask my mom to explain to me how a mortgage works. Mostly, I had no idea what happens to the mortgage if you move out of the house before you finish paying it off. Thanks for dumbing it all down for me mom!

Aren't you glad you decided to read this post? It's super interesting and fun right?
Apparently being an adult also means getting worked up about your finances, on a Friday.

Let's break it down.

I take the metro to work every day, $8.20 round trip. Most days, either because I'm running late, I'm feeling lazy, or it's raining, I also drive to the metro and park-even though I live within 10 minutes walking distance. To park at the metro is another $5 every day.  Also, I pretty much buy my lunch every day. That's another $8-$10 every afternoon.

While the metro travel is a non-negotiable (ridiculously expensive yes, but I have to get to work somehow), the $5 parking is quite simply a waste of money.  I have two legs, and an umbrella. I should be walking everyday and saving that $25 a week.

If I bring my lunch to work every day that's another $50 a week.
But...lunch is a tricky subject. I don't want to sit at my desk and eat leftovers or my sad little yogurt and stare longingly out the window (that I don't have) but I really want to check off #43, pack my lunch every day for an entire week.  On nice weather days I can enjoy my lunch in the park or somewhere outside. But what do I do when it rains or in the winter (or when it's a thousand degrees outside) when the park is no longer an option?

These are the things I worry about? Hah.

But now that I have a credit card to call my own, and now that I know I don't have near enough money squirreled away for a down payment, I am feeling like it's time to get serious about my spending habits.

Ugh, the math/number hater in me is squirming.

18 comments :

  1. We use our credit card for most purchases. We pay off the card at the end of up month, so we're never charged interest. But we get to add up points for the dollars we're spending! It's fun to get things for free just for buying things with our credit card.

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    1. That's definitely a plus. I did get a cash back credit card so I am pretty excited about that as well!

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  2. For what it's worth, I knew next to nothing about mortgages (it's something to do with paying for your house, like a credit card but different?) until I married into one, and nothing about selling a mortgaged house until we sold our mortgaged house :-) Experience is a great teacher! So is a smart mom ;-)

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    1. I think you are so right! Thanks for your encouraging comment!

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  3. Woohooo you got your first credit card!! Go crazy!!!

    Juuuuust kidding.

    We have a couple of credit cards that we use to buy everything, but we are super strict with our budget and we ALWAYS pay off our card every month. It's obviously a good way to build credit (and the only way we were able to get a house), but we also love the airline miles! We have a southwest credit card and love it! We have pretty much flown everywhere for free the past few years!

    I think it's awesome that you are getting so serious with your spending. Great habits to build now so you can be financially stable in the future!

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    1. I think an airline card would definitely be one I'd like to look in to in the future. I tend to do a lot of flying and free flights sounds like pretty magical! Hope you have a good week!

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  4. My husband was in the exact situation as you a few years ago, no debt = no credit. I still find it completely stupid! The good news is that by putting a couple things on the credit card and paying them off over a few months his credit was built up in no time, and now it's awesome! As for mortgages they still confuse me, and we bought our house a year ago! They're frustrating because there are so many different kinds and terms, and they've changed a lot in the past few years, so friends who bought a few years ago, might not be much help for advice! I think it's incredibly admirable that you're getting so serious about your spending! Have you ever seen PlanetBox lunch boxes? There are tons of idea of what to put in them on their website and on pinterest. I feel like it would make me make better lunches even though I stay home with my 18 month old! haha!

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    1. Glad everyone seems to understand the no debt=no credit is just dumb. Definitely encouraged by your comment! And I will definitely be checking out PlanetBox. Thanks for the suggestion!

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  5. I turn 28 on monday and the whole concept of finances makes me still want to crawl away and hide in a fort in my parent's basement. Adulthood scares me. Sheesh.

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    1. Happy birthday! Basement forts are the best! adulthood... not so much.

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  6. When I graduated college, I tried signing up for my first credit card and the bank wouldn't let me . . . because I didn't have any previous credit . . . it was so bizarre.
    I didn't have a card until Chris and I got married, and we're SUPER careful to pay it off at the end of every month so we're not charged interest. We basically just keep track of our spending to make sure we're not going over our monthly limit, which is way different from our credit limit.

    I don't know if things like mortgages ever REALLY make sense. I mean they do . . . but they don't.

    As a kid, you get all excited about credit cards and buying your own things as a grown-up, but you have no idea the strings and responsibilities that are attached. Maybe it's better that way ;]

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    1. It's all such weird circular logic. You need credit to get approved for a credit card but you need the credit card to build credit (unless you have debt).

      I think as a kid I used to think credit cards were like free money. Sigh... to be that naive again.

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  7. Oh, Shannon, sounds like you are definitely headed in the right direction and will get it all figured out. But, the whole no debt, no credit, is insane to say the least. But, I have no doubt you'll have a high credit rating in no time. Happy week of teaching!

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  8. I still don't have a credit card! With no credit, even Target denied me. My bank said there was nothing they could do for me either.

    I was just like you 'why have one, I'll spend only the money I have, thank you.' Luckily Dan had good credit, or buying the house would have been difficult.

    I probably should figure out a way to build credit. Such a weird world that we live in!

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    1. Such a relief to hear someone else my age has no credit (and that yall were able to buy a home)! I ended up getting mine through my bank and I was nervous they wouldn't approve me. I'm surprised Target didn't let you have one? I'm definitely going to look into that card in the near future. 5% off, yes please!

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  9. I applaud the 'save money' notion, but you need to eat lunch out of the office sometimes, especially in the winter when you can't take a brought from home lunch to the park. Why don't you start small...bring your lunch twice a week? Or maybe more in nice weather? I miss the basement forts sometimes too, and I have been an adult a long time : )

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  10. I pack my lunch for work every day. It is a HUGE money saver and I actually enjoy packing it each night! When it's nice I eat outside but in the rain or cold weather I eat in a common area of the office or at my desk, but I don't check my email or answer my phone. I usually bring a book or magazine. It works for me!

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  11. Hey Shannon! For my job, I reviewed thousands of mortgages and loan applications and also analyzed hundreds of credit reports so I can definitely help if you have any questions. Your credit score will go up if you're responsible about your payments (a given for you it sounds) and you continue increasing your available credit. So make sure in 6 months you call your bank and say I'd like my credit limit increased to $X. Someone our age can get it up past $15,000 without too much time. Also, you should have at least one more credit card that you use occasionally so it stays active (it will also increase your available credit). It may be a good idea to get a free credit report now to check and see what your starting score is and then try to get it up by the time you apply for a mortgage someday.

    Also, I love Mint.com for tracking all of my expenses on my credit card and categorizing them within my budget.

    Let me know if you have any questions! As a former Finance major, I like these topics. Also, I've been trying to pack my lunches so if you ever just want to go for a walk around our offices and/or eat our lunches in Farragut Park let me know! My office moved a few blocks North but I'm still only a few minutes from Farragut Park.

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